On Friday, Microsoft Corp beat Amazon.com Inc. and won the Pentagon's $10 billion cloud computing contract. President Trump had articulated antagonism to giving the lucrative grant to a company led by Jeff Bezos, a regular target of his ire.
The Pentagon's $10 billion contract is a Joint Enterprise Defense Infrastructure cloud (JEDI) which is a part of a broader digital modernization program of the Pentagon. This contract is meant to make it more technologically agile. The main goal of JEDI is to provide the military with better access to data and the cloud from battlefields and other remote localities.
"It's crystal clear here that the President of the United States did not want this contract to be awarded to one of the competitors," said Franklin Turner, an attorney with the law firm McCarter & English. "As a result, it’s fairly likely that we will see a number of challenges that the procurement was not conducted on a level playing field."
The company had originally been opposed to the idea of awarding such a massive contract to a single company, arguing such an approach would hinder innovation. "We believe the best approach is one that leverages the innovations of multiple cloud service providers," the company said early last year.
In a statement announcing Microsoft as the winner, the Pentagon underscored its view that the competition was conducted fairly and legally. However, Microsoft shares were up 3% to $144.98 in after-hours trading after the news while Amazon shares went down 0.92% to $1,745.12.